Insiders: Bessent urged Trump not to dismiss Powell

ChainCatcher news, citing the Wall Street Journal reported by Jinshi Data, informed sources say that U.S. Treasury Secretary Basant recently privately advised Trump not to attempt to dismiss Federal Reserve Chairman Powell. Basant's reasoning mainly revolves around several themes: the potential impact on the economy and markets, the prospect of the Federal Reserve possibly lowering interest rates later this year, and the political and legal obstacles that such a move might face.

Basant believes that firing Powell is unnecessary because the economy is performing well, the market is responding positively to the president's policies, and Federal Reserve officials have already signaled that they may lower interest rates twice before the end of the year. If he were to be dismissed before the end of Powell's term, Powell might file a lawsuit, which could drag on until next spring, when Powell's term is also set to end.

Basant also pointed out that Governor Kugler's term will end in January next year, and Powell's term will end in May, which will give Trump one or two vacancies to fill early next year. Basant's cautious attitude contrasts with some other government officials who are considering more aggressive strategies. Trump stated to reporters on Tuesday that he finds Basant "reassuring."